Education, Training and Probability of Transition to Permanent Employment in the Italian Regional Labour Markets

Posted: 19 Dec 2009 Last revised: 30 Apr 2010

Date Written: April 1, 2007

Abstract

The aim of this paper is to investigate the factors determining the “speed” of transition between a temporary/precarious job towards a stable one in the Italian regional labour markets. In this context the importance of individual human capital is widely recognized by the economic literature. Nevertheless, education is not the only variable affecting this kind of labour market transitions. In this paper, in order to have a better understanding of the transition processes to stable employment in Italy, I developed a theoretical model in which the intensity of transition between temporary and stable jobs depends on individual human capital and unemployment rates at regional level. In particular, the claim is that higher rates of unemployment at regional level would reduce the new entrants’ wages and would contribute to increase the minimum level of education for the investment in training, and the subsequent confirmation of a temporary worker on the expiry of a fixed-term contract, to be profitable for the firm. To test this hypothesis I estimated a discrete time duration model with gamma-distributed unobserved heterogeneity, based on ECHP data for Italian regions (1995-2001), disaggregated at territorial level. Results are consistent with the implication of the theoretical model.

Keywords: temporary employment, labour market transitions, unemployment, human capital

JEL Classification: J21, J24, J31

Suggested Citation

Ghignoni, Emanuela, Education, Training and Probability of Transition to Permanent Employment in the Italian Regional Labour Markets (April 1, 2007). Rivista Italiana degli Economisti, Vol. 1, April 2007. Available at SSRN: https://ssrn.com/abstract=1525780

Emanuela Ghignoni (Contact Author)

University of Rome La Sapienza ( email )

Piazzale Aldo Moro 5
Roma, Rome 00185
Italy

Register to save articles to
your library

Register

Paper statistics

Abstract Views
154
PlumX Metrics